PETROL prices in the Chester area are holding steady, despite this week's tax increases.

PETROL prices in the Chester area are holding steady, despite this week's tax increases.

But motorists are being warned that petrol stations across the city are unlikely to continue absorbing the extra cost.

Ray Holloway, director of the Petrol Retailers' Association, told The Chronicle it was likely that Wednesday's 1.28p-a-litre increase would be absorbed by most retailers in the short term.

He said: 'There's been no real change. Super-markets tended to mark down at the weekend and the message is that they are absorbing the increases and that's because they are always absorbed for a period.'

Mr Holloway said the cost price to the filling station had fallen, which is allowing them to be more accommodating to Gordon Brown's increase.

He added: 'Every petrol retailer in the UK has the absolute right to raise prices by 1.5p because of Gordon Brown's increase.

'However, it's likely that the increase will be absorbed.'

Supermarkets were the first to announce they had absorbed the increase in duty.

On the morning of the increase, Sainsbury's in Great Boughton's price was 74.7p a litre for unleaded and 75.9p for diesel, while Safeway in Upton's forecourt displayed 75.9p and 76.9p.

A spokesman for Tesco said: 'What we're doing is monitoring prices daily so we will always be the cheapest in the area daily.'

Morrison's did not disclose its prices for Wednesday but said that from yesterday they would be 72.9p for unleaded and 73.9p for diesel.

Safeway is selling unleaded at an average price of 73.9p a litre and diesel 74.9p a litre.

Kate Prescott, spokeswoman for Safeway, said: 'We price our fuel competitively within the local area. Fuel prices will differ in areas, dependent on local conditions.'

Independent petrol stations are finding it harder to absorb the tax increases and prices have already gone up at garages including Cottage Filling Station on Sealand Road and Red Ensign Filling Station in Saughall.

Selvaraj Sathiyaraj, manager of Save Service Station in Saltney, said he had trouble competing. He said his prices - unleaded 74.9p, diesel 75.9p - will probably rise by 3p or more when he takes his next delivery.

Charles Sharp, manager of Tarporley Garage, which sells unleaded at 76.9p and is owned by Texaco, said he was waiting to hear when prices would go up from the oil giant.

He said: 'People are asking when is it going to go up.

'During the last few days, people have wanted to fill up before the prices go up.

'I think by and large they just accept it.'

Yana Harden, manager of Essoowned Parkgate Service Station on Parkgate Road, said petrol retailers bore the brunt of tax rises.

On the morning of the tax rise, she said: 'It's the oil companies that dictate but it's the retailers that suffer the abuse of customers, like during the fuel crisis.

'But we have had no major negative comments this morning.

'Everything's gone fine, so we're lucky.' According to AA Petrolbusters, this week Chester's average petrol price was 76.4p, higher than Manchester's 75.5p, Northwich's 75.2p, Liverpool's 74.7p and Birkenhead's 74.3p. Wirral's average price is lowest of all in the area at 74.0p.